Darshan Singh Parmar v. UOI

Case snapshot

Sections / provisions: MGST 73

Questions before the Court / Tribunal

• Reward for information relating to tax evasion: The reported judgment concerns a government reward scheme for information on tax evasion and directs fair implementation/payment where the reward had been determined, subject to the exact scheme terms in the official judgment.

Material facts and background

lgc IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION WRIT PETITION NO. 2283 OF 2013 Darshan Singh Parmar, Aged about 64 years, Indian Inhabitant, Residing at Old Barrack T50, Room No.216, Chembur Camp, Mumbai- 400076

The Director of Central Bureau of Investigation Department, Economic Offences Wing, Kitab Mahal, 3rd floor, D.N. Road, Mumbai-400001

______________________________________________________ Mr D. S. Sakhalkar with Mr. Himanshu Thakur i/b Suresh Patil, for Petitioner. Ms

Mr Himanshu Takke, AGP, for the Respondent Nos. 2 and 3. ______________________________________________________ CORAM : M.S. Sonak & Jitendra Jain, JJ. RESERVED ON : 10 June 2025 PRONOUNCED ON : 24 June 2025 JUDGMENT: (Per M. S. Sonak, J.) 1.

Accordingly, with the consent of and at the request of learned counsel for the parties, this Petition was heard for final disposal.

institution of this Petition in 2013, seeks an appropriate writ to direct the Respondents to reward the Petitioner for valuable information

Government and its Sales Tax Department from 1992 onwards, based upon which, the sale tax recoveries were made from the tax evaders. This reward is claimed by relying upon the circular/resolution dated 01 January 1976 (Exhibit A at pages 14 to 19 of the paper book). 4.

Appellant / assessee submissions

2. Mr Takke, learned AGP places on record the communication dated 4 October 2024 which suggests that the Petitioner is held eligible and admissible to reward amount of Rs 19,44,802/-. He points out that since the reward amount exceeds Rs 5 Lakhs, the competent authority for sanction is the government. He states that within a reasonable time, the government will decide the issue. 3. Learned Counsel for the Petitioner points out that this reward amount concerns only one of the oil companies. He also points out the additional reward is due to the Petitioner. 4. At this stage, we are not deciding or disposing of the matter finally. All such issues can therefore be raised on the next date. 5. For the present, we are interested in ensuring that at least the admitted amounts are paid to the Petitioner at the earliest. 6. Therefore, we list this matter on 7 February 2025 for directions. We expect that by end of January at least, necessary orders and payments are made to the Petitioner.

Revenue / respondent submissions

The judgment copy does not separately set out this component in a distinct section; refer to the full order and the reasoning section below.

Court / Tribunal analysis and reasoning

September 2015 is relevant and the same is therefore transcribed below for the convenience of reference:“8. I say that at this stage part of the recovery is pending due to pendency of first or second appeals as also where recovery is complete in case of disposal of second appeals, reference is pending before this Honourable Court. If reference is allowed in favour of the assesse in final hearing the consequential order of the Tribunal may result in refund of recovery already enforced or complied. In other words the amount recovered, due to pendency of appeals and reference cannot be said to be irrevocably recovered. Hence amount recoverable irrespective of actual recovery is determined by this Department and provisional amount of entitlement in the event of recovery reaching finality by conclusion of all proceedings is determined as per communication dt. 07-09-2015 by the Commissioner of Sales Tax, Maharashtra State to the Additional Chief Secretary (Finance) Maharashtra State, Mantralaya Mumbai. A copy of communication dt. 07-09-2015 by the Commissioner of Sales Tax, Maharashtra State to the Additional Chief Secretary Maharashtra State is annexed hereto and marked Exhibit II. I...

recoveries are made and subsequently, the citizens are made to run from pillar to post for getting such reward, citizens would lose faith in the system and would not come forward to give the information. We have further observed that this would result in a loss to the Public Exchequer. 6. Though in the present case, Mr. Sonpal submits that entire recovery is not on account of the information given by the petitioner, but has fairly admitted that part of the recovery is on the basis of the information given by the petitioner. 7. If that be so, the Respondent-Authorities can very well determine as to what percentage of the total recovery is attributable to the information received from the petitioner. If that determination is made, a determination as to how much amount the petitioner is entitled to in accordance with the Scheme framed by the Government can be easily made. 8. We, therefore, direct the RespondentAuthorities to do the determination as directed hereinabove and place the same on affidavit before this Court by the next date. Stand over to 21st July, 2015.”

2. Mr Takke, learned AGP places on record the communication dated 4 October 2024 which suggests that the Petitioner is held eligible and admissible to reward amount of Rs 19,44,802/-. He points out that since the reward amount exceeds Rs 5 Lakhs, the competent authority for sanction is the government. He states that within a reasonable time, the government will decide the issue. 3. Learned Counsel for the Petitioner points out that this reward amount concerns only one of the oil companies. He also points out the additional reward is due to the Petitioner. 4. At this stage, we are not deciding or disposing of the matter finally. All such issues can therefore be raised on the next date. 5. For the present, we are interested in ensuring that at least the admitted amounts are paid to the Petitioner at the earliest. 6. Therefore, we list this matter on 7 February 2025 for directions. We expect that by end of January at least, necessary orders and payments are made to the Petitioner.

irrevocably realised, some reward is still due and payable to the Petitioner. The Respondents are aware of this, and therefore, considerable time was wasted by not precisely informing the Court of the number of recoveries made irrevocably. In the communications dated 7 September 2015 and 4 October 2024, a determination was made, as a result of which, the Joint Commissioner of Sales Tax decided that an amount of Rs. 19,44,802/- was payable as a reward to the Petitioner. However, this communication, issued with the appropriate approval of the Commissioner of Sales Tax, Maharashtra, stated that since the reward amount exceeds Rs. 5 lakhs, Government sanction was required. As no decision was taken on the Government sanction, we were compelled to issue the order dated 20 December 2024.

As the amount of the reward exceeds Rs. 5 lakh, the competent authority to sanction the reward is the Government. Therefore the quantification of the award be approved so that the same can be granted to the informer. (With prior approval of Hon. Commissioner of State Tax, Maharashtra) Regards, (Vanmathi C.) Joint Commissioner of State Tax, Investigation Branch-B, Mumbai.

Operative decision and relief

2013 onwards, the defence that information was not supplied in the prescribed Form-A was never raised. The only defences, as noted above, were that no reward is payable unless the revenue is irrevocably realised. It was pointed out that the recoveries were subject matters of appeals etc, and until all these were disposed of, no reward could be paid. After these issues were sorted out and even the reward amount was determined, this latest defence has been raised without verifying the records or factual position. 31.

disposed of in the above terms without any cost orders.

Interim Application (L) No.13522 of 2024 does not survive and the same is accordingly disposed of. 36.

Authorities and precedents appearing in the judgment

• Lalan Kishor Singh vs. State of Maharashtra & Anr)

This list is machine-assisted from the judgment text and is not a substitute for checking the full citation chain in the PDF.

Ratio and legal principle

The decision turns on Reward for information relating to tax evasion. The operative result is classified as Disposed. Read the rule only with the statutory version, factual findings and precedent chain recorded in the full judgment.

Why this judgment matters

The case is relevant to taxpayers, advisers and litigators dealing with Reward for information relating to tax evasion. Its practical value lies in the interaction between the statutory text, the evidentiary record and the procedural route followed in this case.

Practitioner action points

• Preserve portal notices, e-mail/SMS delivery evidence, reply acknowledgements and the statutory appeal timeline; procedural service facts can determine available relief.
• For litigation, attach the full judgment/order to the working paper and cite the paragraph/page supporting the proposition rather than relying on a headnote alone.

Full judgment and source trail

Read / download the clean local judgment copy

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